(erielack) Re: Taxes

["Bill K." <pontiac_@_dreamscape.com>]

Over on the Lehigh Valley, without commuter service to deal with, with a lot
less property to tax but also a lot less revenue, they managed to show a
small profit the first quarter of 1975 by their own accounting methods.
Given they hadn't made any money since 1956, it was pretty insignifgant, but
it does point in the direction that a lower tax burden might have allowed
the EL to make a profit.


I think you'll find that Conrail dumped the cutoff as much because of the
taxes on it as anything else, doesn't seem like being owned by the
government made them immune to that problem.  Anyone know what the tax rates
actually were, or how it was calculated?  I know some states based them on
not only property but even the number and length of tracks on the property -



Also, for what it's worth, I heard a report on the radio the other day (on a
Utica NY station) that Onieda County is revoking it's "Payment in Lieu of
Taxes" ("PILOT") agreement with the NYS&W.   They're unhappy and feel the
railroad violated the agreement when they made steps to allow a power
company to use the property to build a large power line from upstate to the
NYC area.   This will cost the NYS&W approximately $115,000 per year
according to the report.  Wonder what this will mean for the north end of
the old DL&W?  They've already given up on the middle of the branch -

Just for comparison's sake, when I look at tax auction info, the average
homeowner pays around 1/100th of that (anywhere from $800 to $2000
typically) annually.


Bill K.




- ----- Original Message -----

>
> >From Archives_@_Railfan.net
> Message-ID: <003f01c6f9b1$104ce400$7a01a8c0_@_paul>
> Date: Fri, 27 Oct 2006 06:17:10 -0400
> From: "Paul Brezicki" <doctorpb_@_bellsouth.net>
> Subject: (erielack) Taxes Revisited
>
> I've been looking at EL financial statements for 1973 and '74 (definitely
not a "pick-me-up"), and in light of our recent discussion of high property
tax in eastern states, especially NJ, I noted the item "Taxes other than
taxes on income" (EL didn't have any of the latter, of course). This is from
the 1974 Annual Report and so is not further detailed, but I presume most of
it is property tax, from which apparently bankruptcy did not provide relief.
This item cost EL about $31.5m in 1974, 23% more than in 1973. EL's net loss
in '74 was $17.2m. The added $6m tax burden helped consume a good chunk of
the $25m increase in freight operating revenue, which was due to rate
increases. So it appears that EL may actually have been profitable if not
for excessive property tax. No wonder NKP and then N&W didn't want any part
of it. Comments, anyone?
>
> Paul B
>
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